Pension reforms in Europe: An investigation with a computable OLG world model

Aglietta, Michel; Château, Jean; Fayolle, Jacky; Juillard, Michel; Cacheux, Jacques Le; Garrec, Gilles Le; Touzé, Vincent

doi:10.1016/j.econmod.2006.11.001

Cited by 33 publications

(23 citation statements)

References 6 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Although there are a number of multi-country overlapping generations models which investigate the relationship between demographic structure and the pattern of international borrowing and lending (e.g., Kenc and Sayan, 2001;Brooks, 2003;Momota and Futagami, 2005;Domeij and Flodé n, 2006;Bajona and Kehoe, 2006;Aglietta et al, 2007;Fehr et al, 2008;Tosun, 2008), little attention has been paid to the link between demographic difference and the pattern of international trade. 3 Notable exceptions are Sayan (2004, 2005) and Sayan (2005), who show that aging (i.e., an exogenous fall in the rate of population growth) makes the country relatively more capital-abundant (i.e., labor-scarce), thereby lowering the autarky steady state relative price of the capital-intensive good.…”

mentioning

confidence: 99%

Aging, transitional dynamics, and gains from trade

Naito

Zhao

2009

Journal of Economic Dynamics and Control

View full text Add to dashboard Cite

a b s t r a c tWe formulate a two-country, two-good, two-factor, two-period-lived overlapping generations model to examine how population aging determines the pattern of and gains from trade. Two main results are obtained. First, the aging country endogenously becomes a small country exporting the capital-intensive good, whereas the younger country endogenously dominates the world economy determining the world prices, in the free trade steady state. Second, although uncompensated free trade cannot be Pareto superior to autarky, there exists a compensation scheme applied within each country such that free trade is Pareto superior to autarky.

show abstract

mentioning

confidence: 99%

Aging, transitional dynamics, and gains from trade

Naito

Zhao

2009

Journal of Economic Dynamics and Control

View full text Add to dashboard Cite

show abstract

“…Consequently, it might be useful to consider Europe as a financial union large enough to influence the saving-investment balance in the world economy (see Aglietta et al, 2007). As a result, this generalized but asynchronous ageing process between the different world regions may give rise to opportunities that would be mutually advantageous compared to a situation of economic and financial autarky.…”

Section: Resultsmentioning

confidence: 99%

“…This rich modeling framework allows us to stress the 'triangular ' relationship between population ageing, pension reforms, and international capital markets, which receive increasing attention in the academic literature, see Kenc and Sayan (2001), Brooks (2003), Bo¨rsch-Supan et al (2006), Aglietta et al (2007), and Krueger and Ludwig (2007). For instance, during the demographic transition, the mix between PAYG and fully funded pensions schemes within European countries will induce different saving behaviors in the different countries.…”

Section: Introductionmentioning

confidence: 99%

Disparities in pension systems and financial flows among European countries

Château

Chojnicki²,

Magnani

2008

Journal of Pension Economics and Finance

Self Cite

View full text Add to dashboard Cite

We present a quantitative analysis of the impact of differential ageing and pension reforms on capital and labor market and, in particular, on intra-European capital flows. To this end, we develop a stylized general equilibrium model with overlapping generations of heterogeneous agents for the three largest European countries: France, Germany and the United Kingdom. The model presents a structure halfway between pure general equilibrium models with rigorous microeconomic foundations and accounting models where the macroeconomic environment remains exogenous. We show that the dynamics of capital accumulation and pension system sustainability are totally different depending on the assumption concerning economic openness. Finally, in the long run, resorting to debt financing seems to be a dead end to finance retirement systems. Printed in the United Kingdom12 Note that assets (t)=0 in the French and German cases.Disparities in pension systems and financial flows among European countries 17

show abstract

“…In the sequel of this section, we use the next generation of OLG models characterized by the implementation of realistic demographic data (Aglietta et al. , 2007; Börsch‐Supan et al ., 2002, 2003, 2006; Börsch‐Supan & Ludwig, 2008).…”

Section: The Mea‐olga Model Variants3mentioning

confidence: 99%

Aging, Asset Markets, and Asset Returns: A View From Europe to Asia

Börsch‐Supan

Ludwig

2009

Asian Economic Policy Review

View full text Add to dashboard Cite

The extent of the demographic changes is dramatic especially in some Asian and European countries. This paper investigates the effect of aging on global asset markets and asset returns, focusing on markets for productive capital, and especially on interactions between European and Asian economic development. Aging has complex effects on the markets for real capital. If elderly people save less than younger people, interest rates will increase. At the same time, however, the younger generation becomes smaller, which reduces the demand for new investment. The equilibrium effect is thus uncertain. Our multicountry computational equilibrium model delivers a subtle picture: there will be some decline in the return from productive capital, but it is relatively small. We find noticeable interaction effects between labor market and pension reforms in Europe on the one hand, and the demographic and economic developments in Asia, especially India and China, on the other hand.

show abstract

Pension reforms in Europe: An investigation with a computable OLG world model

Cited by 33 publications

References 6 publications

Aging, transitional dynamics, and gains from trade

Aging, transitional dynamics, and gains from trade

Disparities in pension systems and financial flows among European countries

Aging, Asset Markets, and Asset Returns: A View From Europe to Asia

Contact Info

Product

Resources

About